Digital income
Mobile Apps
Software distributed through app stores, paid for by users, subscriptions or advertising.
How the money actually reaches you
The app store is the merchant. A user buys the app, buys something inside it, or starts a subscription; the store collects the money, applies its commission — historically around 30% of the sale under the standard developer terms, with reduced tiers for small developers and for subscriptions after the first year, and under active change through regulation and litigation — and pays the developer monthly in arrears after its own hold period. Ad-supported apps are paid instead by a mobile ad network on an impression basis, on a similar monthly delay. Either way you do not hold the customer relationship, you cannot see most of the customer data, and refunds are granted by the store rather than by you.
The customer, directly. A payment processor or a marketplace stands between you and the money and takes a fee for it; an app store or platform takes a commission set in its developer terms. What you actually sell may be a file, a licence, access, a physical parcel someone else ships, or the right to call an interface.
Fastest of the three. Card money typically settles to the processor within days and is paid out on a rolling schedule, minus a reserve on new or high-risk accounts. Marketplaces and app stores pay monthly, in arrears, after their own hold period.
Read the payer, the intermediary and the schedule before anything else. Who pays, who sits in the middle taking a share, and how long after the work the money arrives explain most of the difference between these fourteen businesses.
The structural facts
Six lines, in two halves. The first three are what the model takes — money up front, waiting time, and the rhythm of work it never stops needing. The last three are what happens once it earns: how the income fades if nothing new is added, what stops it growing past a point, and what, if anything, stops the next person copying it. A model with no answer to the last two can still pay; it just does not compound.
- Capital to start
- Moderate to high unless you write the code yourself: development, design, developer programme fees, and the equipment to test on. Paid user acquisition, if used, dwarfs all of it.
- Time to first dollar
- Months. Building, then store review, then finding anyone at all — discovery inside an app store is its own unsolved problem.
- Ongoing effort
- Mandatory, not optional. Operating systems ship yearly and break things; store policies change; SDKs deprecate. An app that is not maintained eventually stops being allowed on the store.
- How it decays
- Enforced. Unlike a web page, an unmaintained app can be removed from the store for failing to meet a new requirement, which turns neglect into a hard zero rather than a slow decline.
- What caps it
- Discovery. The store's own search and charts decide who finds you, and the alternative is paid acquisition priced by the same advertisers competing for the same users.
- What stops a copycat
- Data the user has accumulated inside the app, integrations, habit, and a brand people search for by name. Features are copied within weeks.
What it costs to run
- Developer programme fees for each store
- Development and design, in-house or contracted
- Backend hosting and third-party APIs
- Analytics, crash reporting and support tooling
- Paid user acquisition, where used
- Devices and test hardware
How it typically fails
- Nobody finds it. Store discovery is the distribution problem in its purest form.
- An OS release breaks the app and the maintenance never happens.
- A policy change makes the monetisation model non-compliant.
- Free users cost server money and never convert.
- Paid acquisition costs more per install than an installed user is ever worth.
Does it sell?
Whether a business can be sold is the plainest test of whether it is an asset or a job. A buyer pays for income that continues without the person who built it, which means verifiable revenue, a customer relationship that transfers, and a distribution channel that does not walk out of the door with the founder. This section describes whether that market exists for this model — not what anything is worth, which no honest public source can give.
Apps trade, both through online-business brokers and through acquisitions by portfolio operators who buy small apps to run at scale. The buyer inspects store analytics, subscription retention, and whether the app depends on an API or SDK that could be withdrawn. Transferring the listing itself is a formal process through the store, and it is a step deals actually get stuck on.
Where people look
A storefront for selling digital files, courses and memberships, handling checkout, file delivery and sales tax on the seller's behalf.
Fee is taken per sale rather than as a monthly subscription
Visit Gumroad ↗A publishing platform for email newsletters with paid subscriptions, payment processing and a subscriber list built in.
Takes a percentage of paid subscription revenue plus card processing
Visit Substack ↗Amazon's self-publishing service for ebooks and print-on-demand paperbacks, which pays the author a royalty on each sale.
Royalty rate depends on list price band and file delivery size
Visit Amazon Kindle Direct Publishing ↗Hosted software for building and selling online courses, including payments, student accounts and drip release of lessons.
Visit Teachable ↗Sponsored links are labelled. Listing a service is not an endorsement of it, and nothing on this page is advice.
Frequently asked
What commission do the app stores take?
Is an app passive once it is built?
Who owns the customer relationship?
Others running on the same engine
Subscription Websites and Membership Sites
Gated content or a community that members pay for monthly or annually.
Paid Newsletters
Writing delivered to an inbox, paid for by subscribers, sponsors, or both.
SaaS Businesses
Software run as a service, billed monthly or annually to the people using it.
Online Courses
Recorded teaching sold once and delivered many times, direct or through a marketplace.
Digital Templates and Downloads
Files sold repeatedly — templates, presets, fonts, printables, plugins, spreadsheets.
Stock Photography Portfolios
Images, video clips and audio licensed repeatedly through agencies, paid per download.
E-Commerce With Outsourced Fulfilment
Selling physical goods someone else stores and ships — third-party logistics, print-on-demand, or dropshipping.
Domain-Name Portfolios
Holding registered domain names for lease, parking revenue or eventual resale.
Data and API Licensing
Selling access to a dataset or an interface, priced by seat, by call, or by contract.
Research only. This page describes how a business model works, what it costs and how it fails. It does not recommend starting one, does not estimate what anyone earns, and is not investment, tax or legal advice.